Banks haven't gotten the tax fraud message: prosecutor

By IBT Staff Reporter On 03/04/11 AT 7:24 AM

Foreign banks have not gotten the message when it comes to helping American clients avoid paying taxes, a top U.S. tax prosecutor said on Thursday.

Kevin Downing, a senior trial attorney at the Department of Justice, also said a handful of Swiss bankers indicted last week will face Interpol red notices and risk arrest should they leave Switzerland.

He made the remarks at a legal conference in Southern California.

U.S. officials are investigating other banks after UBS AG in 2009 paid $780 million and last year agreed to hand over nearly 5,000 account names to the U.S. government to settle tax evasion charges.

The latest indictment, filed last week, charges four current and former bankers at a large Swiss international bank with encouraging Americans to use offshore credit cards and to move money to other banks from Israel to Hong Kong.

That bank has been identified by sources close to the case as Credit Suisse, which has said it is not a target of any probe.

After the UBS case was resolved, Downing said the bankers very politely walked down the street to the next Swiss bank, or an Israeli bank with a Swiss headquarters -- or helped them find their way to Hong Kong or Singapore.

Downing declined to comment on the status of Credit Suisse, but added: I'm sad to report the problem continues.

Many believe the indictment signals the government is trying to build a case against Credit Suisse.

Earlier this week, one of the accused bankers, Emanuel Agustoni, said he acted with Credit Suisse's knowledge and consent.

Asked to respond to Agustoni's comments, Downing said: He should get a U.S. lawyer and come talk to the Department of Justice.

U.S. authorities will devote considerable resources to go after the banks, the bankers, and most importantly the clients, Downing said.